About Citrix Systems, Inc.
Software and devices from Citrix Systems make seamless connections between its customers' computer systems and networks and their employees' computers and mobile devices. With Citrix products, PCs, IP phones, smartphones, and other devices can get remote and secure access to applications across wired and wireless networks. Its product line includes application virtualization software (Citrix Virtual Apps and Desktops), network access devices (Citrix ADC), cloud computing connectivity, and mobility applications (Citrix Endpoint Management). Citrix also offers managed online collaboration services for meetings, technical support, and remote desktop access. The US accounts for more than 50% of revenue.
Citrix operates through the operates through the Digital Workspace, Networking, and Professional Services segments.
The company's Digital Workspace, about 70% of revenue, allows customers' employees to work from outside the office. Its products are Citrix Virtual Apps and Desk, which deliver applications to computers and iOS and Android mobile devices. The Citrix Endpoint Management application helps corporate systems meet mobile device security and compliance requirements for "bring your own device" programs. The Citrix Workspace offering puts many of the company's products and services into one package.
Networking, about 30% of revenue, provides Citrix ADC (application delivery controller) and Citrix SD-WAN. The products help manage network loads, improve network performance, and provide security.
Professional Services, about 5% of revenue, help customers implement Citrix products.
Citrix uses third-party contractors such as Flex International to make its hardware. The company's cloud-based services run on Microsoft Azure and Amazon Web Services, as well as other providers.
Citrix, headquartered in Fort Lauderdale, Florida, rings up more than 50% of revenue in the US, about a third in Europe, and 10% from the Asia/Pacific/Japan region.
Sales and Marketing
Citrix markets and licenses its products and services through multiple channels worldwide, among them value-added resellers (VARs), independent software vendors (ISVs), and original equipment manufacturers (OEMs). The company relies on one distributor, the Arrow Group, for about 15% of sales. Citrix targets such customers as CIOs, desktop operations managers, IT infrastructure managers, network architects, and server operations managers, as well as small business and individuals.
Subscriptions provide about 15% of revenue while products and services generate about 25% with service and support providing the lion's share of sales, about 60%.
Citrix's revenue has trended higher on increasing subscription and cloud-related sales in the past three years after sales dropped 15% in 2015, following peak sales of $3.1 billion in 2014.
The company took in $2.9 billion in 2018, a 5% increase from 2017, boosted by a rise in sales of the company's cloud-based products, buoyed by a 44% increase in subscription-based sales in 2018. The move to cloud services by customers cut sales of its perpetual products and services in 2018. Sales rose in Citrix's three geographic areas in 2018 from 2017.
Citrix posted net income of $575.6 million in 2018 compared to a $20.7 million loss in 2017. The profit resulted from higher sales in 2018 combined with the absence of a loss due to discontinued operations that the company had in 2017 and lower tax bill year-to-year.
The company's cash and equivalents dropped to $1.8 billion in 2018 from $2.8 billion in 2017 due to stock buybacks, debt payments, and cash paid for acquisitions. In 2018, operations generated about $1 billion, investments provided $132 million, and financing activities used $166 million.
Citrix is focused on three trends that are reshaping the computing landscape: personal mobility, enterprise cloud evolution, and cloud services build-out. Mobile is at the core of the company's strategy as it shifts from the focus on virtualization. It continues to introduce new versions of its products to address these markets.
Citrix Systems concentrates on providing access to digital systems by developing its core enterprise products including Citrix Virtual Apps, Desktops, Citrix ADC, and Citrix Endpoint Management. The company is moving to the software-as-a-service (SaaS) model in which it sells subscriptions to its products and services. Its SaaS revenue had increased more than 30% in each of the past three years, but accounts for just 15% of revenue.
Deferred revenue, a key measure of software-as-a-service, dipped about $30 million in 2018 after rising about $180 million in 2017. Besides deferred revenue, Citrix cites unbilled revenue, money in multi-year contracts that has yet to be paid, as an indicator. Unbilled revenue rose to $338.5 million in 2018, an increase of about $258 million from 2017.
Citrix has about $1.9 billion in long-term debt, which limits spending and borrowing flexibility in adapting to changes. Its interest payments rose to more than $80 million in 2018 from about $52 million in 2017.
Mergers and Acquisitions
Citrix Systems has added to its cloud capabilities through acquisitions.
In 2018 Citrix acquired Sapho, a startup which connects legacy software with micro-applications, for $200 million. It is intended to advance the company's development of the intelligent workspace.
Also in 2018 the company acquired Cedexis, a Portland, Oregon software developer that optimizes application performance and content delivery across hybrid and multi-cloud environments.
In 2017 Citrix acquired Unidesk for about $60 million. Unidesk was the inventor of the Microsoft Windows application packaging and management technology known as application layering. It should help Citrix provide customers a better experience in delivering and managing applications and desktops in the cloud, on-premise, and in hybrid cloud environment
Citrix Systems was founded in 1989 by a crew of former IBM engineers that included Edward Iacobucci. It was Iacobucci who, as a Big Blue designer in 1984 working alongside Bill Gates and a cadre of engineers from IBM and the fledgling Microsoft, led the team that developed the OS/2 operating system. Iacobucci quit IBM in 1989 and turned down a technology officer position at Microsoft to start his own business.
Iacobucci licensed Microsoft's OS/2 source code to start the Citrus Company, quickly changing the company name when one venture capitalist mistook it for a fruit concern. Waiting for investment funds, Iacobucci wrote an OS/2 programmer's guide (featuring a foreword by Gates) that significantly boosted his credibility among the software elite.
By 1991 Citrix had developed an OS/2-based program that let users on separate terminals run software off a larger computer. The week the product shipped, IBM and Microsoft called off their OS/2 development partnership. With business publications sounding the death of OS/2, Citrix in 1992 regrouped its network vision around Windows. The changes contributed to losses for 1992 and 1993.
Through a partnership with network software specialist Novell, in 1993 Citrix introduced WinView, which let non-Windows PC users tap into Microsoft programs on a network of disparate systems. Novell's clout boosted the company's distribution capabilities, and sales ballooned. Citrix went public in 1995.
851 W CYPRESS CREEK RD
Fort Lauderdale, FL 33309-2040
Phone: 1 (954) 267-3000
Employer Type: Publicly Owned
Stock Symbol: CTXS
Stock Exchange: , NASDAQ
Chairman: Robert M. Calderoni
Interim CFO: Mark M. Coyle
President, CEO, and Director: David J. Henshall
Employees (This Location): 600
Employees (All Locations): 8,200